Wednesday, October 22nd, 2014

Walk-O-Meter

Cut small-business taxes


Will cut taxes for small business. "In the first special session I call, I would seek tax cuts for small businesses with 50 employees or less."

Updates

The measure the Legislature approved was scaled back from the original promise

Scott Walker, constrained by state fiscal woes and some technical hurdles, downsized his small business tax cut plan before he sent it to the Legislature.

His original plan called for a tax break of 1 percentage point for small businesses with 50 employees or less.

After he took office Jan. 3, 2011, he changed and trimmed the plan substantially, proposing a credit targeting businesses with less than $500,000 in gross receipts. Even that scaled-back idea carried an $80 million price tag over two years.

In the end, the Legislature went with a tiered approach that further modified Walker"s plan. Under the bill, businesses with sales of up to $5 million annually would receive a tax deduction of $4,000 for each job they create. Businesses with sales of more than $5 million a year would receive a deduction of $2,000 for each job they create, the Journal Sentinel reported.

Overall, the proposal would save businesses an estimated $33.5 million in taxes and cost the state that amount in lost revenue. The actual state tax savings per job would amount to between $92 and $316, depending on how the business owner files and what tax rate applies to him or her, according to an analysis by the nonpartisan Legislative Fiscal Bureau.

Walker came through when it came to getting a small business tax cut through the Legislature.

The smaller size of it merits a rating of Compromise.

Sources:

JSOnline.com, Tax cut for job creators advances, Jan. 25, 2011

JSOnline.com, Walker outlines business tax cut, Jan. 5, 2011